GOLD - Outlook Remains Higher But With Caution

GOLD The commodity continues to hold on to its upside pressure leaving risk of more strength targeting the 1,300.00 level. On the downside, support comes in at the 1,280.00 level where a break will turn attention to the 1,270.00 level. Further down, a cut through here will open the

Gold (XAU/USD)
1284.29
0.09
(0.01%)
04:42:23 (GMT) Start trading
Sell
Bid: 1283.99
Ask: 1284.59
Open: 1284.2
High: 1285.12
Low: 1281.8
08:0016:0015. Jun1275128012851290
prices continue to gain traction rising for a 6th consecutive trading session, and poised to test the May highs at 1,304. Softer than expected U.S. Retail Sales helped buoy the price of the yellow metal. Support on gold is seen near the 10-day moving average at 1,252. Momentum is positive as the MACD (moving average convergence divergence) index prints in the black with an upward sloping trajectory which points to higher prices for the yellow metal. The RSI (relative strength index) moved higher with price action reflecting accelerating positive momentum.

U.S. retail sales rose 0.5% in many with the ex-auto component up 0.4%, a little softer than forecast. There were no revisions to the 1.3% headline gain in April and the 0.8% ex-auto gain. Sales excluding autos, gas, and building materials increased 0.5% versus 0.9% previously.

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The EUR/JPY dipped 11 points this morning sending the yen into a tizzy as it touched 111.38. The Japanese yen has taken full advantage of the Brexit referendum, which saw Britain vote to exit the European Union. The yen has posted strong gains of 3.5 percent since Brexit, as jittery investors have dumped risk assets in favor of the safe-haven Japanese currency. Brexit aftershocks are far from over, as underscored by the woeful British pound, which is struggling at 30-year lows. With risk sentiment decidedly negative, the yen could break below the symbolic 100 level, which last occurred just after the Brexit vote in late June. Although the Bank of Japan has been reluctant to adopt further easing measures, it may have to act in order to curb a streaking yen which is hurting the export sector. Japanese officials have repeatedly warned against what they have termed “currency manipulations” and have threatened to intervene if the yen continues to move higher.
More effective in weakening the yen has been monetary policy. Massive injections of money into the economy by the Bank of Japan in recent years helped push the Japanese currency to around 125 to the dollar in 2015. But its efforts to stimulate the economy this year, including a shock move to negative interest rates, failed to halt the yen's rise.

Gold prices moved lower on Thursday following the decision of the BoE to keep rates unchanged. The central bank is expected to provide stimulus at its August meeting according to the statement released at the time of the decision. Gold was weighed on as another round of risk-on dents the yellow metal's safe-haven appeal.Prices were unable to recapture resistance near the 10-day moving average at 1,350. Support is seen near an upward sloping trend line near 1,300.
Momentum has turned negative as the MACD (moving average convergence divergence) index generated a sell signal. This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses below the 9-day moving average of the spread. The index is printing in the red with a downward sloping trajectory which is pointing to lower prices for the yellow metal.

Gold Price Prediction for July 22, 2016..
Gold prices rebounded as the risk off trade gave the yellow metal a boost. Arrests made in Brazil to spoil a terror plot increased the need for save haven assets. Prices tested resistance near the 10-day moving average at 1,337, while support is seen near the 1,315 level. Inflation expectations remain in check which could put downward pressure on gold prices. Momentum remains negative with the MACD (moving average convergence divergence) index printing in the red with a downward sloping trajectory that points to lower prices. Prices originally broke out above the 1,300 level which should prove to be a battle ground if risk on perpetuates.

Brazil arrested 10-12 for an Olympic plot allegedly thought to be an all-Brazilian ISIS-sympathetic cell preparing some mayhem during the Olympics, according to the Justice Ministry.

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